Wednesday, September 26, 2012

International Taxation of Unpaid and Underpaid Mail:
1976 Lausanne Handling Charge System

1976 Japan postage due handstamp (Amount Due + Handling Charge)

(Readers unfamiliar with international postage due taxation should refer to THIS ARTICLE)

The Vienna system of taxing unpaid or underpaid international mail, in place since 1966, was revised at the 17th Universal Postal Union Conference held in 1974 at  Lausanne, Switzerland. The taxation change came into effect on January 1, 1976.

This post begins with a review of the Vienna System then explains the Lausanne system showing examples of taxed international mail from Canada. The scarcity of post-1976  Canadian taxed international mail is also discussed

The Vienna System

The Vienna system required the county of origin to mark the letter  with a T stamp along with a fraction in which the numerator was DOUBLE the amount of the underpayment and the denominator was the country of origin's international letter rate. The country of delivery would then multiply the tax fraction by its international letter rate to calculate the charge.


Milan, Italy to Toronto, October 28, 1967

Italian international letter rate : 90L
Prepaid: 50L
Underpaid: 40L
Double deficiency : 80L

Italian Tax Fraction:

Double deficiency/UPU letter rate = 80/90

Canadian charge:

Lauzanne Handling Charge System ( From January 1, 1976)

The country of origin's T fraction was changed to SINGLE the amount of the underpayment over the country of origin's international letter rate. The country of delivery still multiplied the fraction by its international letter rate but added a HANDLING CHARGE of 60 gold centimes* at most or the charges prescribed by internal legislation. [Article 21 (f) UPU Regulations]

*To put this amount in perspective, the UPU basic letter rate was 50 gold centimes. [The 1989 Washington UPU Congress abolished the gold franc and replaced it with Special Drawing Rights (SDR),the International Monetary Fund accounting unit.].

Lausanne Handling Charge Formula:


Canada's Implementation of the Lausanne Handling Charge System

In 1976 (presumably January 1), Canada Post Office began to tax outbound mail single the amount of deficiency. However incoming deficient mail continued to be charged according to the Vienna system, i.e. double deficiency without handling charge. The author does not know if or when Canada began using the Handling Charge System for inbound mail.

(1) To Great Britain (20 Cent International Letter Period)

Bridgewater to Birmingham, February 24, 1976
20 cents letter rate (Shortpaid 4 cents)
Canadian Tax Fraction : 4/20
British Charge : 13p

Canada Tax Fraction

Great Britain Charge


(2)  To Germany (25 Cent International Letter Period)

The international printed matter rate was 12 cents for the first ounce, effective January 1, 1977.

 Nanisivik, N.W.T., to Munster, Germany, February 14, 1977
12 cents international printed matter rate (other articles)
Shortpaid 2 cents

Canada Tax Fraction

2 cents single deficiency/ 25 cents international letter rate

Germany Charge

55 Pfennig due

The author does not know how the German post office arrived at this amount.

 (3) To Denmark (35 Cent International Letter Period)

Guelph to Ringsted, Denmark, May 27, 1979
35 cents post card rate (same as international letter rate)
Shortpaid 13 cents

Canada Tax Fraction

13 cents single deficiency/ 35 cents international letter rate

Denmark Charge

160 øre due

The author does not know how the Danish post office arrived at this amount.

(4) To Germany (35 cents International Letter Period)

Kemptville to Bayreuth, West Germany, August 12, 1981

35 cents letter rate
Shortpaid 18 cents

Canada  Tax Fraction

18 cents single deficiency/ 35 cents international letter rate

Germany Charge

97 Pfennig due

 The author does not know how the German post office arrived at this amount.

(5) To Sweden (64 cents International Letter Period)


Calgary to Stockholm, January 26, 1983
64 cents letter rate
Shortpaid 4 cents

 Canada Tax Fraction

4 cents single deficiency/ 64 cents international letter rate

 Sweden Charge

165 øre due

The Swedish international letter rate from June 1/81 to May 31/83 was 240 øre   , and there was a handling fee of 150 øre.

Swedish Charge = 04/64 x 240 øre  (postage due) + 150 øre  (handling charge) = 165 øre

(6) To Austria (64 cents period)


Didsbury, Alberta to Salzburg, Austria, January 28, 1983
64 cents letter rate
Shortpaid 4 cents

Canada Tax Fraction

4 cents single deficiency/ 64 cents international letter rate

Austria Charge

2.50 Schillings due

The author does not know how the Austrian post office arrived at this amount.

 A Collecting Challenge

Taxed international mail from Canada during the post-1976 period is difficult to find. Generally, instead of taxing mail with return addresses, the Post Office either returned the mail to the sender for additional postage or advanced the deficient postage.

Advanced Postage

Lauzon, P.Q. (G1K 3W0 LPP) to Magenad, Lesotho, January 16, 1982
60 cents letter rate

The "A" stamps (30 cents denomination) were not valid for overseas
The "Canada Postage Paid" handstamp indicates that the Post 
Office advance the postage and sent a card to the sender requesting
payment of 60 cents, single deficiency.

Postage Due Notice Card

Postage Due Notice card advising sender of insufficiently paid mail that the deficient postage was advanced by the Post Office. A double weight (40g) letter to Stockholm, Sweden was shortpaid 33 cents. The following information and instructions are provided:

Rather than delay the item or have the addressee pay the postage due, the necessary postage has been placed on it.
The amount due is shown in the shaded area (lower left hand corner). Please affix stamps on the reverse side of this card and mail it.

33 cents in postage was affixed to the front of the card paying the postage due (single deficiency). Postmarked Carleton Place, November -,1982

Japan Handling Charge 

The above domestic U.S. cover was sent from Garden City, Michigan, to Cuyahoga Falls, Ohio, November 1976. The addressee had advised the post office that he had moved to Japan and requested mail forwarding. The office affixed a yellow redirection label.

Redirected Mail Taxation

Under the previous Vienna system, underpaid mail was taxed at double the deficiency, while redirected mail was taxed at single the difference between the original rate and the rate to the new destination. With the introduction of the Lausanne system, underpaid and redirected mail were both taxed at single the deficiency.

Since the surface letter rate to Japan (18 cents) was greater than the domestic surface letter rate, the letter was taxed. The difference in rates, 5 cents, is the numerator of the tax fraction, and the international letter rate, 18 cents, is the denominator of the tax fraction.

Japan Charge

The Japanese post office handstamp explains how 95 yen, the amount charged, was calculated:

Postage Due : 25 yen
Handling Charge: 70 yen
I do not know how the Japanese post office calculated the 25 yen charge. Assuming an international letter rate of 50 yen (to be confirmed), then 25 yen is double the amount due. This is incorrect since redirected mail was to be charged at single the deficiency. However, it may be that 25 yen was the minimum postage due charge.

Refused and Returned


Since the addressee refused to pay the Japanese charge, the letter was returned to the sender. There is no indication that the sender was charged by the U.S. post office.